Crossrail spending

Meeting: 
MQT on 2013-05-22
Session date: 
May 22, 2013
Reference: 
2013/1254
Question By: 
Caroline Pidgeon
Organisation: 
Liberal Democrats
Asked Of: 
The Mayor
Category: 

Question

Is Crossrail being delivered cost effectively?

Answer

Answer for Crossrail spending

Answer for Crossrail spending

Answered By: 
The Mayor

Boris Johnson (Mayor of London): Yes, Caroline. You are asking me about whether Crossrail is being delivered in a cost-effective way. I think the answer is yes. We have obviously cut the overall spending envelope for Crossrail since the Comprehensive Spending Review (CSR) in 2010 from £15.9 billion to £14.8 billion, so there has already been a substantial reduction. If you remember, there was a lot about descoping some of the station boxes and deciding to do the tunnels first rather than the station boxes first and that took a lot of cost out.

But, clearly, this is something over which TfL will want increasingly as Crossrail becomes more and more of a London project. I do not want to mince my words. TfL and the GLA generally will want to have very close oversight of this project because, after all, we are going to be running it. This is going to be a London railway.

Caroline Pidgeon MBE (AM): Thank you for that. The points you make are fair. You have recently been touring Britain and Whitehall making the case for investment in London and I and my colleagues here, I am sure, wholeheartedly support this effort. If you are going to make the case for London, you have to make sure that the money you have in your spending is being spent wisely. Crossrail is, as you said, a £14.8 billion programme and yet there is considerable waste of public money, not in the tunnelling and some of the mechanics but actually within some of the support services. So, for example, within their external affairs team, are you aware that Crossrail has spent some ridiculous sums of money, £320,000 on photography and video, £320,000 on printing, £900,000 on staff training?

Boris Johnson (Mayor of London): Staff training? That does not seem to be totally ludicrous.

Caroline Pidgeon MBE (AM): Yes. £32,000 on travel. My favourite is an amazing £1,000 on cake for staff communications. It must be some hell of a cake, I have to say. What are you doing as chair of TfL to drive down these excessive costs at a time of belt-tightening across the whole public sector?

Boris Johnson (Mayor of London): I cannot testify as to the whereabouts of the cake.

Caroline Pidgeon MBE (AM): You did actually get a slice, then?

Boris Johnson (Mayor of London): My policy on cake, as you know, is pro having and pro eating it. Spending a certain amount, £900,000, on staff training does not feel to me like the most totally ludicrous expenditure I have ever heard, Caroline. Your point in general is a good one. I have to reiterate what I said at the beginning. I think that the condominium arrangements that currently exist between us at the Department for Transport (DfT) cannot go on for ever. We need to make sure for the benefit of London and indeed for the London taxpayer and for taxpayers generally. I think that in the end Crossrail is going to have to be brought under TfL in London and the GLA and I hope I have your support in that.

Caroline Pidgeon MBE (AM): Good. Last autumn Crossrail put out a contract for £250,000 for crisis communications guidance. Crossrail also has awarded contracts nearing £500,000 to one single communication agency, 39 separate payments over two years, some of this for management and support consultancy for communications, without going through a normal tender process. Is there really no one within TfL who could have provided this kind of support without spending hundreds of thousands of pounds worth of public money?

Boris Johnson (Mayor of London): I am grateful to you for drawing my attention to these items in the Crossrail budget. As I say, I do think that we are going to have to change the supervision arrangements for Crossrail in the fairly near future. At the moment it is jointly governed by two sponsors in the form of us and the DfT and I am not convinced myself that that is an arrangement that is sustainable in the long term. We will sort that out.

Caroline Pidgeon MBE (AM): I welcome what you are saying because Crossrail currently employs 39 external affairs staff for just this one project and yet talking to TfL (and I am, as you know, not always the greatest fan of expenditure at TfL), they only have 40-50 staff and that covers all modes of transport and ones that are actually running rather than a project that is being built. So I really would encourage you to stop this waste and look at whether you could we talk about shared services all the time. Bring this in-house and let TfL actually manage this to save the waste of public money and help you in your case to Government for investment in London transport.

Boris Johnson (Mayor of London): Yes, Caroline, I am grateful to you for that question because you have brilliantly illustrated the difference between the way we have been running TfL and the way things can be run if not wholly and exclusively managed by this benign operation. What we certainly did was to reduce overheads at TfL very considerably and you will know that it is not just a question of reducing people in the external affairs department of TfL. We have cut costs in TfL and we have taken costs out of about £9.8 billion and

Caroline Pidgeon MBE (AM): Will you just agree to bring this into TfL to manage?

Boris Johnson (Mayor of London): what you have there is a perfect case for wanting to see (and I think you and I would agree strongly about this) closer and more direct scrutiny and management of that project by London because in the end this is a London project. By the way, I do not want to

Caroline Pidgeon MBE (AM): Will you commit to bring this into TfL so that their team can manage this expenditure and make sure that we are getting value for money? Just yes or no.

Boris Johnson (Mayor of London): Yes. Nothing would give me greater pleasure than to make sure that Crossrail was run by London since it is a London project.

Caroline Pidgeon MBE (AM): Lovely. Thank you. Thank you, Chair.

Boris Johnson (Mayor of London): I would just remind you before you criticise Crossrail too heavily for employing loads of people, it is the biggest engineering project in Europe. It is colossal. It is going to add 10% to the rail capacity of this city. It is not a small undertaking that they are involved in.

Caroline Pidgeon MBE (AM): Thank you.